Bank shares are leading the way as the market welcomed news of the €85bn Irish bailout finally agreed last night.

The FTSE 100 is up 41.01 points at 5709.71, with Royal Bank of Scotland taking the top spot with a 1.03p rise to 39.72p. Barclays is 5.55p better at 265.35p while Lloyds Banking Group is 1p better at 62.85p.

And Dublin must be relieved to see that Irish Life and Permanent Group is up 48%, Allied Irish Banks is 7% better and Bank of Ireland has jumped 23%.

Investors seem to have put aside worries - for the moment at least - about the European sovereign debt crisis spreading, despite continuing talk that Portugal and even Spain might be next up for a bailout. Worries about conflict in Korea and possible interest rate rises in China to dampen demand also appear to have been put on the back burner. Later come growth forecasts from the UK government's office for budget responsibility. Simon Denham, managing director at Capital Spreads, said:

The markets have a small spring in their step. As a minimum the details of the bailout puts the Irish problems to bed for a while. As November draws to a close many investors will wish to forget it pretty quickly and the bulls in particular will be hoping to see the usual seasonal rally in December.

With the market moving higher, insurers are also in demand.
Prudential has put on 14p to 591p and
Aviva has added 8.1p to 377.8p. Aviva was helped by JP Morgan putting an overweight rating on the company with a 524p price target. But
Resolution has dipped 1.8p to 223.3p after the bank began coverage with an underweight recommendation. It said:

While we acknowledge that the poor share price performance of Resolution since launch in 2008 (down 41%) has left the shares undervalued, we think that there are much better stories elsewhere in the sector.

We see some industrial logic for the [recent] Axa/ Friends Provident combination but still think the combined group is one of the least attractive of the listed names from both a cash flow and operating perspective.

The main positive is that Resolution has potential excess capital and could probably undertake a £1bn-£1.5bn acquisition without equity financing. Indeed, for the Axa deal to work, we think that this capital has to be
deployed relatively quickly. Given that the market appears not to believe in the current M&A strategy being pursued by management, we believe the most productive use of this capital would be to return to shareholders via a buyback.